REALTORS® recommend that buyers get pre-approved prior to initiating the
mortgage process to determine the best type of mortgage for you and avoid
rushing into a mortgage decision. Pre-approval is an official agreement by
the lender specifying the exact amount for which you've been approved. In
order to get pre-approved, you'll meet with a loan officer who'll review
your credit history and often suggest a mortgage type that fits your
situation. This process requires supplying the lender with various
financial documents discussed in the Financing
section. By receiving pre-approval before making an offer to
purchase, you'll demonstrate your serious intentions and financial
ability to the seller.

Pre-approval is not to be confused with pre-qualification, however.
Pre-qualification provides an informal means to find out how much you may
be able to borrow. Before setting your price range for how much you can
spend on a new home, you may want to pre-qualify for a mortgage. You can be
pre-qualified over the phone by answering a few questions about your
income, long-term debt and the amount of your downpayment. Getting
pre-qualified gives you a ballpark figure of the amount you may have
available to spend on a home.

Downpayments and Financial Assistance

Even first-time buyers are usually aware that they'll be required to make a
downpayment in order to secure a home. But what you may not have heard is
that within the past decade, downpayment assistance programs have been
developed that either lower the deposit dramatically or eliminate it
altogether. Before making your downpayment, you'll want to investigate
these programs to see if you qualify. Several California and federal
assistance programs are outlined in the Financing
section.

While low downpayments might seem attractive to cash-strapped buyers, keep
in mind that the larger the downpayment, the smaller the mortgage loan --
thereby allowing you to develop equity quicker. You'll also want to
consider that mortgages with less than a 20-percent downpayment usually
require mortgage insurance. When determining the size of your downpayment,
you may want to weigh the other costs involved, including closing costs and
relocating expenses.

You'll find information about the various types of mortgages, application
process, homeowners' insurance and more in the Financingsection.